Can the Blockchain fight child labor?
How Farhan Shahid aims to use Blockchain technology to improve child labor conditions in Pakistan
When meeting Farhan Shahid to talk about his university blockchain project, I learned a lot about how blockchain technology can improve the process of renting an apartment in Germany in the first part of our interview.
But towards the end of our interview, we picked up on a topic that addresses a very different aspect of how blockchain can bring about change.
In order to give it the space it deserves, I decided to write this part II of my interview with Farhan. Let’s dive into it.
Tjark: Farhan, you’re not only a blockchain practitioner, but also with your background in Pakistan know the challenges developing countries face today. Is there a specific challenge to which you would like to apply blockchain to?
Farhan: Yes. A specific use-case of blockchain that I find very powerful is remittance payments. Instead of going through the traditional banking system and paying high fees for long transaction times, you can use a blockchain. This is especially interesting to improve child labor conditions in Pakistan.
So, the specific problem that I saw when I went back to Pakistan in September was that there are a lot of children working there. So a lot of young kids who don’t have time to study but are working at restaurants or other places.
And one way to improve this is to find people in developed countries willing to support children in Pakistan with donations. And it makes a lot of sense because a child in Pakistan may earn 200 rupees per day which is converted into Euros only about 2 to 3 Euros per day.
So with a small donation you can actually make a huge impact on a child’s life in Pakistan.
Tjark: How can blockchain help here?
Farhan: So the idea I was thinking of is to use blockchain for the remittance-transfer when people in the developed world donate. Because, if you go through the traditional banking systems you loose a large percentage of the donation to transfer-fees.
And of course you don’t want to give up this portion to a central authority that is just controlling the transferring process. With blockchain you can have much lower transaction fees and process the transaction a lot faster too.
So what you could do is to send money to a child in Pakistan that is not able to study because it has to earn money for a living. You just replace his salary with a donation. If the child is currently making 2 Euros a day, you give him 2,50 Euros but in exchange require him to study.
In order to really incentivize the child to study, you have to attach the payment to milestones. So for example, every week he would have to show that he has actually studied the material he was provided with.
And in Pakistan you can have institutions that monitor exactly this. One potential partner that is already on the ground is Teach for Pakistan.
So, once you build this system in which children are paid for studying and once these children know they cannot be paid unless they show progress, then you can actually take a lot of kids out of child labor.
And you don’t really need to provide them with a complete schooling. You could teach specific skills. So for instance, you can teach computer programming. And once they have such a skill they can become self-sufficient. This could help a lot.
And another way you can use blockchain in this process is to incentivize the donors. In order to incentivize more and more people to donate you can provide them with a digital version of collectibles on the blockchain.
So think of it as the Pokemon cards you would collect as a child. Back then, you might have had a very rare card that no one else had and you were very proud of it.
In the same way, when someone donates a lot, he sometimes receives a certificate. Some people put that up in their house to show to others that they have been donating for good cause.
Now in the digital blockchain age, you can do a counterpart of that too. Because there is no central authority in a blockchain, you really own the tokens, for example Ether tokens. Because only you have the private key, you are the only one able to sign transactions to move the token.
Instead of having only tokens and currencies you can also apply the same principle to collectibles, too. The most famous example for this is crypto-kitties.
In the game crypto-kitties people actually own a picture of a kitty that only they can sell to someone else. It’s a direct equivalent of a Pokemon card from the traditional age to a digital age.
The way you can apply this in the donation system is to give a person that donates for a certain time a reward in form of a collectible on the blockchain that they can keep forever.
Tjark: So basically, you would add gamification to the donation process?
Farhan: Yah, exactly. Donors can keep their collectibles forever and there is even more potential.
The founder of Ethereum, Vitalik Buterin, has proposed the idea that websites should integrate such collectibles.
So if a person has donated money to some good cause, he receives a crypto-collectible that shows that he for example donated 100 Euros. And then, if for example Twitter integrates this, you could see on a person’s profile the collectibles that he owns.
And this can be used as a signal to show that I’m a nice person. So blockchain can be used to incentivize people to donate by giving them these collectibles that they can show to other people.
Tjark: This could have a huge impact, especially when services like Twitter or LinkedIn would integrate these crypto-collectibles.
Farhan: Yah. That’s especially the case with LinkedIn. Right now I can create an account and tell a lot things about me that might not necessarily be true.
But if you show a crypto-collectible on LinkedIn that says you donated 100 Euros you can actually be sure that this person has really donated 100 Euros because you can look at the smart contract and look at all the records.
Because the collectible you see on his LinkedIn page is actually retreived directly from the blockchain. That way you can be sure that this person did something nice. You don’t have to trust the person to speak the truth.
Just like if somebody tells you that he has a very rare Pokemon card. Unless he shows you the card and unless you can definitely know for sure that he hasn’t forged it, you cannot trust him.
So, if intergrated into websites, a crypto-collectible can be a nice way of signaling that you have done something nice.
Tjark: To realize such projects a vibrant environment with people interested in supporting blockchain entrepreneurs is very helpful. How do you perceive the blockchain scene in Munich where you currently study?
Farhan: Yah right. I think there are a lot of business-minded people that are very interested in the technolgy.
So if you go to meet-ups you meet a lot of people who want to understand the technology from a business point of view in order to integrate the technology into to their business.
That’s where I met people who wanted me to build a blockchain solution for their company. And this was when I had the idea to build up a developer team.
As an individual developer and someone who is still finishing his Masters, I cannot commit working on a blockchain solution for someone. But if I have other people working with me, then we can take up these projects.
Tjark: What are your plans with your team?
Farhan: The way that the team started is that I went back to Pakistan. There, a few of my friends from my Bachelor’s in Pakistan have formed a team called LOGICON to do freelance work in web- and mobile development.
Freelance work makes a lot of sense in Pakistan because the cost of working in Pakistan is a lot lower than in other countries.
Especially, if you can find clients from abroad, it is a Win-Win for both parties because the client can get a cheaper deal while it is still a good deal for the people in Pakistan.
And my friends’ team recently got into the blockchain development space too. For instance, one project they are currently working on is for an U.S. company that builds up a social investment platform on top of blockchain.
When we realized that we are all interested in blockchain, it made a lot of sense to collaborate. And the way we do that is by having an office in Pakistan.
There, we can based on the project requirements hire new people and also train them in new technologies.
That helps us to expand the team as much as we want for a project. So the idea is that we get projects from Germany that I’m interested in.
Tjark: So you’re currently looking for contracting projects in Munich to work on with your team in Pakistan. What are your plans when you’re done with your Masters?
Farhan: Yah. So, I enjoy using blockchain to solve real world problems. That’s why after I graduate I want to be involved in such projects as part of the team of freelancers at LOGICON and possibly in other capacities as well.
I am also really excited about bringing to life the idea I talked about, improving child labor conditions in Pakistan.
Tjark: This sounds great Farhan. Thank you very much for the interview and I really hope you will succeed. Perhaps this interview will reach the right people that can support your project.
About the interviewee:
Farhan Shahid, 26, was born in Lahore, Pakistan. He recently moved to Munich to pursue a Masters degree in Informatics at Technical University of Munich which he will finish in April. He is blockchain developer with an entrepreneurial mindset and part of a developer team in Pakistan that does blockchain contracting work. You can reach him via LinkedIn.
About the author:
Tjark Friebe is highly interested in learning about cutting-edge technologies and how to apply them to solve real-world problems. To do so, he started a blog on Blockchain explaining the technology and interviewing practitioners from the space. You can reach him via LinkedIn.
